Slope of Hope Blog Posts
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The famous Butterfly Effect is the idea that small changes in a non-linear system can cause large differences to a later state. The idea is that a butterfly flapping its wings in (say) Greece might cause a hurricane to form in (say) the US. I'm no expert on butterflies but I can say with confidence that in the current market any eruption of wind from a greek politician or from one of the many empty heads of state at the G-20 in Cannes may show up in equities moments later. Be warned, and let us all hope that politicians in Europe everywhere today can avoid eating brussels sprouts and baked beans, as well as sounding off to journalists. 🙂
Notwithstanding the news, the technical picture is looking bullish on balance today, though less strongly than it did yesterday morning. It's less strongly bullish mainly because a number of instruments are at resistance levels, though there are a lot of bull flags forming under those levels. On ES the W bottom I was looking at yesterday has been playing out and if resistance at 1260 breaks then I'd expect a run further up. The bull flag target would be in the 1280 area: